Xie Xin of China Biopharmaceutical: Medical IPOs will diverge, and funds will flow to targets with clear BD and commercialization prospects | Outlook on the medical industry in 2026
After four years of "de - foaming" and "reshuffling", the medical and health sector finally welcomed a turning point in 2025. A series of BD transactions, combined with the continuously rising profit expectations of innovative pharmaceutical companies and policy dividends such as the restart of the "Technology Company Special Route" on the Hong Kong Stock Exchange and the fifth set of rules on the Science and Technology Innovation Board, have led the secondary market to kick off a new upward cycle.
Throughout 2025, a total of 39 medical and health companies successfully launched IPOs, raising a total of 35.9 billion yuan. At the individual stock level, the annual gains of more than a hundred companies exceeded 100%. The market values of 14 companies, including China Biopharmaceutical, Hengrui Medicine, BeiGene, Baili Tianheng, and Innovent Biologics, exceeded 100 billion yuan. The overall composition of the top 10 medical and health companies by market value has also shifted from traditional comprehensive pharmaceutical companies and CXOs to innovative drug concept companies.
Next, can the IPO dividend period of the Hong Kong stock market and the Science and Technology Innovation Board continue? How will the overseas expansion boom catalyzed by innovative drug BD change? At the beginning of 2026, 36Kr interviewed nine investors and entrepreneurs in the medical and health sector and summarized the following ten trends and insights. For details, see 2026 Medical Outlook: Hundreds of Companies Queueing up for IPOs in Hong Kong, Can the Medical Sector Create Another "Myth"? .
Meanwhile, to ensure the continuity of viewpoints, all the viewpoints of the interviewees are published separately here. In this article, Xie Xin, Executive Director and Senior Vice - President of China Biopharmaceutical (01177.HK), will share insights on the development trends of the innovative drug sector from the perspective of a local buyer. In the past year, China Biopharmaceutical has successively completed acquisitions of innovative pharmaceutical companies such as Lixin Pharmaceutical and Hejiya Biotech.
The following is the full text of Xie Xin's viewpoints:
In 2025, the total base amount of overseas BD transactions of Chinese innovative drugs reached 130 billion US dollars. In my opinion, in terms of absolute amount and trading volume, the growth of BD transactions this year may not be as significant as last year.
However, overall, I haven't observed a trend of weakening enthusiasm for BD transactions. Chinese pharmaceutical R & D still has the advantages of low cost and high efficiency. Some multinational pharmaceutical companies are even considering conducting pre - clinical and early clinical trials of their global products in China. As long as this underlying advantage remains unchanged, the pace of BD transactions will not slow down significantly.
Meanwhile, past transactions were relatively concentrated in the field of tumor immunology, but now, the diseases and technological paths involved in transactions have become increasingly diverse. For example, around the FGF21 target in the weight - loss field, there were several major mergers and acquisitions last year: Novo Nordisk acquired Akero Therapeutics for 5.2 billion US dollars, Roche acquired 89Bio for 3.5 billion US dollars, and GSK acquired Boston Pharmaceuticals for 2 billion US dollars.
Another example is in the field of respiratory diseases. Last year, Merck & Co. acquired Verona Pharma for 10 billion US dollars. The latter's core product is Ensitufen, a PDE3/4 dual inhibitor for chronic obstructive pulmonary disease (COPD). It was approved for marketing by the US FDA in 2024 and is the first new inhalation - mechanism drug for COPD approved by the FDA in 20 years.
These cases show that in addition to tumor immunology, more and more diseases are gradually presenting BD transaction opportunities.
For China Biopharmaceutical, we focus on four major fields: tumor immunology, liver disease metabolism, respiratory antiviral, and topical drugs. In 2026, while deeply exploring these four fields, we will accelerate the development of products for chronic diseases such as cardiovascular and cerebrovascular diseases and central nervous system diseases. From the perspective of technological paths, we are concerned about small nucleic acids, ADCs, bispecific antibodies, and central - nervous - system - related technologies.
We will also pay attention to immature technological paths such as in - vivo CAR - T, but we need to see more drug - forming data before taking action to balance risks and avoid being replaced by better technologies in the future. We are not worried about missing the first wave of investment opportunities. Even if the cost of participating in the later stage is higher, relying on our advantages in clinical and sales resources, we may still obtain considerable returns.
In addition, since last year, funds have begun to flow back into the domestic AI - based drug discovery field, and we have also established an AI team of more than a hundred people. I believe that it is an inevitable trend for molecules autonomously designed by AI to be approved for marketing, but the core is "those who have the data will win the world". Data reserves determine the effectiveness of clinical advancement and product implementation.
In the secondary market, after two years of bubble and reshuffling, investors have become more mature and have higher requirements for IPO projects. Currently, there are more than 400 companies queuing up for IPOs in the Hong Kong stock market. The IPO performance in 2026 may be polarized. Funds will flow to companies that have successful overseas BD cases/potential, are technologically leading in their niches, and have clear product launch times and sales expectations (such as peak new - drug revenue and profit). On the contrary, companies without competitive advantages will face great pressure in their IPOs.